While fixed income transparency under Mifid II is of concern toeveryone and their mothers at present, trade reporting is really what gets the buyside’s goat, according to a survey conducted by consultancy Protiviti at a client seminar.

The firm asked close to 40 senior compliance officers from regulators, exchanges, tier one banks and some of the UK’s largest asset managers which parts of the Markets in Financial Instruments Directive II will have the greatest impact on their business.

Product governance, which mandates that investment products should be marketed to appropriate people, and dealing commissions, where research has to be paid for separately to trade execution, featured heavily on the list of investment managers’ concerns.

But it was trade reporting where the strongest buyside sentiment showed through.

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Mifid II will mandate that all records related to trading are retained by firms for years – a stretch for buyside shops, particularly those that engage in HFT.

Coupled with requirements for buyside firms to report derivative transactions through the European Market Infrastructure Regulation in August 2015, added provisions in Mifid II could prove problematic in terms of system build-out and connectivity with trade repositories.

By contrast, data and record-keeping and reporting were not among the sellside’s main concerns.

Banks were more likely to be kept awake at night by position limits and management for commodities, the provisions for high-frequency and algorithmic trading and, to a lesser extent, the introduction of electronic derivatives trading platforms.

On record-keeping for electronic communications, a significant pillar of regulations in both the US and EU, both buyside and sellside were equally, but moderately, pre-occupied with the impact.

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